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How does shutting down a hospital allow a PE firm to "cash out"? Let's see some actual numbers on that, not vague claims about tax write-offs. Sometimes PE firm
by nradov 2y ago
How does shutting down a hospital allow a PE firm to "cash out"? Let's see some actual numbers on that, not vague claims about tax write-offs. Sometimes PE firms take on too much debt as part of acquiring a hospital and paying out a special dividend to shareholders. But if the hospital later fails due to being unable to make debt payments then the PE firm takes a loss on their remaining equity stake; they would always prefer to keep it running as a going concern so that they can sell it for an additional profit later.
There is a legitimate issue with concentrated ownership of provider organizations in some regions. More antitrust enforcement is needed to protect consumers but unfortunately that seems unlikely.
- bbreier 2y agoI would say in your toy example the hospital has been shutdown due to the PE firm "cashing out" excessively
- jrflowers 2y ago> How does shutting down a hospital allow a PE firm to "cash out"? https://www.theatlantic.com/ideas/archive/2023/05/private-equity-firms-bankruptcies-plunder-book/673896/ https://www.theatlantic.com/ideas/archive/2023/05/private-eq... https://www.ineteconomics.org/perspectives/blog/private-equity-is-out-of-control-and-looting-america-this-prosecutor-says-we-can-fix-it https://www.ineteconomics.org/perspectives/blog/private-equi...